You're tired. I'm tired. We're all tired. But we'll get through this. Let's begin the cramming, shall we?
If you're here, then you want to become a Chartered Financial Analyst (CFA) but you'll have to work extra hard to get there. It's because the CFA exams are no child's play, with three individual levels designed to test different parts of your knowledge. Cumulatively, all exam levels can take as long as four or more years to pass.
If you're overwhelmed and trying to do some last-minute cramming, you're not alone.
Many CFA hopefuls before you have done the same, and many of them have passed.
However, even if you are cramming, having a strategy is essential. So keep reading for a productive cram session!
Understanding the Level 1 CFA Exam
Before you dive into the material of the CFA exam, you must first understand the characteristics of the test itself.
The Level 1 exam is offered four times a year, with dates in 2022 scheduled for February, May, August, and November.
To register, you must satisfy ONE of the following criteria:
- Have 4,000 hours of experience in a professional setting;
- Possess a bachelor’s degree or equivalent (or no more than 11 months remaining before graduation)
If you qualify to register, you will pay the CFA institute’s one-time enrolment fee of $450 (this fee is not charged for either Level 2 or Level 3; starting in the 2023 cycle, this fee will be reduced to $350).
The exam is offered in a computer-based format (CBT) with an interface that displays the number of questions and the time remaining for your test period.
You can highlight, strikethrough, or flag questions to aid in answering. There is typically a tutorial offered to candidates before starting the exam.
You will be allotted 270 minutes to complete the exam, split into two 135-minute sessions. During this time, you will have 180 questions to answer, which gives you about 1.5 minutes per question to produce a response.
Set Aside Time and Eliminate Distractions
Now, you can start prepping by studying the material. To do so, you must first set aside a dedicated period of time to focus and eliminate all distractions. Here are the most common distractions from studying:
- Text messages and phone calls
- The temptation to check social media
- Impulse to get up and get a snack
- TV playing in the background
- Sounds from others in the house
It's critical to avoid distractions while studying. Do everything in your power to avoid them. Don't waste any of your study time because you're trying to cram for the test. Turn off your phone and shut your door so that you can study and succeed.
Assess and Prioritise
Let's focus on what's most important: exam contents. The exam focuses on ten topics, weighted as follows:
- Alternative – 5 – 8%
- Derivatives – 5 – 8%
- Portfolio Management – 5 – 8%
- Corporate Issuers (this was changed for 2022) – 8 – 12%
- Economics – 8 – 12%
- Quantitative Methods – 8 – 12%
- Equity Valuation – 8 – 12%
- Fixed Income – 8 – 12%
- Ethics – 15 – 20%
- Financial Statement Analysis – 13 – 17%
You might naturally be inclined to think that your cram session should focus on the subjects that make up most of the test, right? But it’s not that simple unfortunately. Try this strategy out instead:
- Grab a pencil and rate your confidence in each category on a scale of 1 – 3.
- Let a 1 mean that you desperately need to study and a 3 signal that you feel pretty good about your mastery of the topic.
- Then, focus on the areas you designated a 1, starting with the most heavily weighted, and work your way towards the are
as that are a 2, followed by 3.
- This will help you build your knowledge without wasting time reviewing the information you already know.
Develop and Maintain Your Own Steady Pace
You know what you need to work on, and now you must come up with a strategic plan. When cramming, whether in a week or an hour, you should pace yourself and don’t try to do too much. To develop a steady pace, you need to allocate a specific amount of time to each section of your work.
A timer helps you precisely manage individual blocks of time.
Here's an example of an itinerary intended for a six-hour cram session covering just one of the Level 1 topics:
- Hour 1: Create flashcards for the subject area you are studying
- Hour 2: Go back through the material, taking note of what you need to know
- Hour 3: Spend time focusing on the material that you are most unfamiliar with
- Hour 4: Reflect on what questions you have about the material that remains unanswered and seek answers
- Hour 5: Answer practice questions on the topic
- Hour 6: Create customised exams based on your unique study needs
You can apply this same principle to each of the different topics you’ll be focusing on. You may need to tweak your plan if you’re spending more or less time on weak or strong areas, respectively. As you’re making progress, don’t get discouraged if the results aren’t as fast as you were expecting. Remember to stick to whatever plan you make — pacing is the key to progress after all.
Check Off All Essential Points
When you have determined what areas need improvement most and how long it will take you to improve in each area, be sure to carefully review the amount of material covered by the CFA program curriculum.
Look over the reading that corresponds to the topic you’re studying for, and make sure that you’re allotting enough time to get through the reading. Note that because the readings can be super long (sometimes more than 100 pages?!), you won’t be able to cram them entirely so only select portions.
Since you're cramming, you’re already short on time, but that doesn’t mean you can’t hit essential checkpoints. Identify key checkpoints to reach within each cramming session. In addition to entire readings, a checkpoint can be any of the following:
- A specific section or sections of a passage in the CFA program curriculum;
- A particular number of flashcards to get through each day;
- A number of mock exams to complete.
Setting goals and pacing yourself to meet them is an effective way to stay on track, even when subject to significant time constraints. Make sure to be realistic in terms of the time you spend on your daily checklist. Try to be as specific as possible when measuring your checkpoints and making sure that you meet those goals.
Practice Exams Are An Investment
An essential part of studying — even if you are cramming — is practicing for the actual test. Practice exams are the perfect way to prepare for exams, help you familiarise yourself with the format, and make sure you have covered all the material. The first step toward tackling the CFA exam is learning how to solve problem-solving situations. This will help you prepare for the CFA exam in the right environment. As you take the mock exam, keep the following principles in mind:
- Pace yourself just like you would during a cram session
- Try to utilise active learning for retaining concepts and formulas
Thousands of CFA candidates sit for the Level 1 exam each year. Although less than half of those candidates pass, that doesn’t mean you can’t be one of the success stories!
Even if you ARE cramming, you can easily pass the CFA exam using the right materials and employing proven strategies to help you achieve your absolute best. Try out our interactive platform, specially designed to help you track and monitor your performance as well as employing all the content in the most interactive and engaging way possible. Don't just take our word for it, actually wait no.... please DO take our word for it!